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The U.S. Supreme Court signaled interest in an appeal by the liquidator of Bernard Madoff’s firm, asking the Obama administration for advice on suits seeking $8 billion from banks alleged to have helped funnel money into his Ponzi scheme, Bloomberg News reported yesterday. Trustee Irving Picard is urging the justices to let him sue HSBC Holdings Plc, UniCredit SpA and UBS AG to recoup customer losses. A federal appeals court said that Picard lacked authority to press those suits, and the justices today requested input from U.S. Solicitor General Donald Verrilli. Picard argued in his appeal that the banks “are as responsible as Madoff for the enormous magnitude of customer losses.”

JPMorgan Chase & Co. will pay $2.6 billion to resolve criminal and civil allegations it failed to stop Bernard Madoff’s Ponzi scheme, bringing its legal settlements from the past two years to more than $29 billion, Bloomberg News reported today. JPMorgan avoided prosecution by acknowledging in an accord with the U.S. that it ignored red flags for about 15 years that Madoff used his account to run a fraud, Manhattan U.S. Attorney Preet Bharara said. The bank will pay $1.7 billion to settle the government’s charges, $350 million in a related case by the Office of the Comptroller of the Currency and $543 million to cover private claims, the firm said in a filing.

U.S. prosecutors and regulators are expected to announce this week that JPMorgan Chase & Co. will pay slightly more than $2 billion in penalties for alleged failures to warn about Bernard L. Madoff's massive fraud, the Wall Street Journal reported today. The federal actions, which are expected to include a deferred-prosecution agreement with Manhattan U.S. Attorney Preet Bharara, could be announced as early as tomorrow. The bulk of the fines are expected to be routed to victims of Madoff, who pleaded guilty to charges he ran a decades-long Ponzi scheme that bilked investors out of billions of dollars. Penalties paid to the Justice Department are expected to form the largest chunk of the total — an amount greater than $1.5 billion.

Five years after lawyer Marc Dreier's arrest for running a multimillion-dollar investment fraud, investors and creditors of his defunct law firm are poised to recover 13 cents or less for each dollar of the more than $375 million owed, the Wall Street Journal reported on Saturday. Sheila M. Gowan, the trustee overseeing the bankruptcy liquidation of Dreier LLP, has proposed a plan to repay creditors using recoveries and proceeds from the sale of the firm's assets, including office furniture and art. The expected payout in the Dreier LLP bankruptcy is dwarfed by what victims of Bernard Madoff's multibillion-dollar Ponzi scheme are likely to collect. As of Dec. 6, the trustee unwinding Madoff's firm had recovered about 54 percent, or $9.5 billion, of the estimated $17.5 billion that investors lost in the fraud, which came to light just days after Dreier was arrested in December 2008. Documents filed in federal bankruptcy court in New York last week show high-ranking creditor claims, including $3.85 million in tax claims and about $9 million that is owed to secured creditors, would be paid in full. Holders of about $375.4 million in unsecured claims, however, will recover between 4.9 and 12.6 percent, according to court papers.

Ambulance operator Rural/Metro Corp., which is poised to emerge from chapter 11 protection in the coming weeks, has agreed to pay $2.8 million to the federal government to settle civil allegations of Medicare fraud, Dow Jones Daily Bankruptcy Review reported today. John S. Leonardo, the U.S. Attorney for Arizona, said yesterday that his office has agreed to a deal with Rural/Metro to settle allegations that the company violated the federal False Claims Act by submitting false bills to Medicare between 2007 and 2011. The settlement resolves allegations that various ambulance companies owned by Rural/Metro billed Medicare for transporting patients from one hospital to another on an emergency basis when, in fact, the calls were not emergencies.

Former Robertson County (Tenn.) Commissioner Shannon Polen was sentenced in U.S. District Court on Thursday to nearly six years in federal prison and ordered to pay more than $10.7 million in restitution to victims of his investment schemes, the Tennessean reported on Sunday. Polen pleaded guilty in December 2012 to two counts of mail fraud, two counts of wire fraud, one count of bank fraud and one count of money laundering stemming from three separate investment schemes that defrauded victims out of about $15 million. He is currently serving a 12-year sentence handed down in August 2012 in Davidson County, Tenn., for two counts of securities fraud and two counts of theft over $60,000. His federal sentence will be served after the completion of his state sentence, U.S. District Judge Todd Campbell ordered. Polen was arrested in March 2011 while still serving on the commission, but he later resigned.

JPMorgan Chase and federal authorities are nearing settlements over the bank’s ties to Bernard L. Madoff, striking tentative deals that would involve roughly $2 billion in penalties and a rare criminal action, the New York Times DealBook blog reported yesterday. The government will use a sizable portion of the money to compensate Madoff’s victims. The settlements, which are coming together on the anniversary of Madoff’s arrest at his Manhattan penthouse five years ago yesterday, would fault the bank for turning a blind eye to his huge Ponzi scheme, according to people briefed on the case who were not authorized to speak publicly. A settlement with federal prosecutors in Manhattan would include a so-called deferred-prosecution agreement and more than $1 billion in penalties to resolve the criminal case. The rest of the fines would be imposed by Washington, D.C., regulators investigating broader gaps in the bank’s money-laundering safeguards.

Even after he confessed to orchestrating the biggest Ponzi scheme in history, Bernard L. Madoff insisted on two points that have since been exposed in court as lies: He acted alone, and his separate market-making operation was "legitimate, profitable and successful in all respects," the Wall Street Journal reported today. Five years ago today, Madoff became a household name due to the breathtaking audacity and scope of his fraud, which resulted in more than $17 billion in losses for more than 12,000 investors world-wide. But a more complete picture of the breadth of his scam is only now coming into focus, thanks in part to a continuing trial in New York federal court that is bolstering a bankruptcy trustee's findings after a review of more than 33 million documents. The trial has highlighted how investigators have reversed their view that, as Madoff had insisted, the market-making and trading operation was walled off from the fraud. They now believe that busy trading desk became Madoff's front, actually losing tens of millions of dollars a year and kept alive with hidden subsidies from the Ponzi scheme, according to Bruce Dubinsky, a forensic accountant with Duff & Phelps LLC, who was hired by the bankruptcy trustee.

Lawyers and other professionals tasked with tracking down the money Madoff stole and returning it to investors have earned more than $820 million to date in the 5-year old case and this week will head to bankruptcy court to request payment of millions of dollars more, the Wall Street Journal reported today. Trustee Irving Picard, an attorney with Baker & Hostetler LLP, is requesting $31.5 million in fees and $810,000 in expenses for the nearly 82,000 hours work that he and his firm performed between May 1 and July 31, a request the U.S. Bankruptcy Court in Manhattan will take up Thursday. According to Mr. Picard, “no single document” can adequately capture all the “hundreds of thousands of hours” of work that his firm and others have put in over the past five years. “Given the unprecedented fraud perpetrated by Madoff, the issues presented by this liquidation are complex, discovery is wide-ranging, and the litigation that has ensued is hotly contested,” his attorneys wrote in court papers filed last month. “All of this requires an enormous effort by the trustee and his counsel for the benefit of the victims.”

U.S. District Judge Jed Rakoff said in a decision yesterday that the trustee seeking money for Bernard Madoff's victims may be unable to pursue some claims against investment firms that fed client funds into the swindler's Ponzi scheme, Reuters reported yesterday. Judge Rakoff also said that trustee Irving Picard could not pursue "unjust enrichment" claims against spouses of Madoff's sons Andrew and Mark, saying the women did not qualify as "insiders" who could be held liable for fraud. The decision dated Dec. 5 is a setback for the recovery efforts of Picard, who is liquidating at Bernard L. Madoff Investment Securities LLC and has said Madoff's fraud caused investors to lose $17.3 billion of principal. Picard has recovered $9.5 billion, of which he has paid out a little over half. Madoff was arrested nearly five years ago, on Dec. 11, 2008, and is serving a 150-year prison term.